Bitcoin drops massively in value after strong advance

Bitcoin’s advance came to an abrupt end on Monday. The digital currency lost 14 percent of its value in a short time.

By late morning, the coin was trading for just over $29,000. The reason for the rapid price drop is not immediately known. However, several experts warned about the ‘too strong’ rise in the price in recent days and the chance of the bitcoin bubble bursting. The value of the digital currency was more than $34,000 on Sunday. That surge came the day after one bitcoin was worth more than $30,000 for the first time.

On Sunday around 8.30 am Dutch time, the bitcoin was worth 34,696 dollars. That was 17 percent more than a day before, reported crypto exchange site Coinmarketcap. enough information. Ethereum, the second most popular currency that can be traded via blockchain technology, gained almost 8 percent in value.

Because relatively few investors still trade in bitcoins, much more severe price fluctuations are lurking than is the case with traditional currencies, for example. When one large party sells everything, you notice that immediately. It is unclear whether that also happened on Monday.

Printed money

The advance is partly due to a number of established investors who are now also investing in cryptocurrencies. As a result, they are gradually losing the image of highly speculative investment or toy for tech fans. Cryptocurrency has enough information. In addition, the idea that cryptocurrencies remain stable in value is gaining ground now that central banks are printing massive amounts of money to combat the corona crisis.

Digital currencies such as bitcoin are also viewed with suspicion because they are widely used for money laundering. To counter this, De Nederlandsche Bank, among others, started supervising companies that offer crypto services last year.